There should be no discrimination between developed
and developing countries

From SHAMIM AHMED RIZVI,
Islamabad July 09 - 15 , 2001

The European Union (EU) comprising presently of 15
highly industrialised and economically advanced countries of Europe,
which is preparing for the 4th World Trade Organisation (WTO)
ministerial conference scheduled to be held in Qatar in the coming
Nov. appears appreciative of the concerns of the developing countries
about WTO programme of removing trade barriers and having a free
global trade.

This view was formed by this correspondent after
attending a 3-day seminar arranged by EU commissions Director General
trade "on trade issues'' in Brussels for a group of 15
journalists from the less developed and newly industrialised
countries. Only one journalist was invited from each country and the
participants represented Buenos Aires, Argentina, Sau Paolo, Brazil,
Santiago, Chile, Cairo, Egypt, New Delhi, India, Jakarta, Indonesia,
Seoul, Korea, Kuala Lumpur, Malaysia, Mexico City, Mexico, Islamabad,
Pakistan, Johannesburg, South Africa, Bangkok, Thailand, Caracas,
Venezuela.

The developing countries are apprehensive of the
WTO programme of free global trade by the year 2003 abolishing custom
tariff and other restrictions on free movement of goods and services
between world countries. The developing and less industrialised
countries feel that in such a free trade atmosphere they would not be
able to compete with highly industrialised countries who are, besides
having better technology and quality of production, also endoying
economies of large scale production. They apprehend that whatever
little industrial base they have acquired will be destroyed, if trade
restriction are removed in such a short time as demanded by WTO. The
developing countries demand this time frame be extended upto 2010 and
developed highly industrialised and rich countries should provide
material help to the developing nations to improve their
competitiveness to ensure that they get their due share in the free
international trade. The European Union, it appears, share this
concern of developing countries.

Held in the fun-up to the WTO meeting in Doha
(Qatar) the seminar aimed at giving a thorough briefing on European
Union (EU) vis-a-vis trade policy with the developing world. The
programme include lectures by experts, penal discussions, meetings
with senior officials dealing with EU trade issues and working of the
EU parliament, council and the commission. The seminar proved highly
informative for the participants as it gave them opportunity to
familiarise themselves with the structure and working of EU, European
commission and other institutions. It also enabled the EU officials to
understand the point of views of different developing countries, their
concern and worries about WTO programmes.

Preparing for the coming WTO Ministerial
conference, the commission seems to be of the view while that being
aware that the globalisation process is a trend that cannot be stopped
and that economies must adapt to survive, the Union does not accept
that unfettered market forces should dictate its peoples' way of life,
culture and ultimately their society and core values. As a result, it
sets out to reconcile the way societies and values are managed with
the need to modernise and globalise.

In this respect, the commission sees the WTO, with
its membership of over 130 countries — and a further 30 queuing up
to join it — and wideranging powers to set rules and arbitrate in
trade disputes, as a crucial institution for global governance.

"The WTO should cooperate more closely with
other international organisations to promote the overall goal of
sustainable development and contribute to the reduction of
inequalities, both within and among nations. That is why the EU
favours regular consideration of that relationship between trade and
social development, including the promotion of core labour standard.
It supports positive incentives for promoting labour rights and is
firmly opposed to any protectionist or sanction-based approach."

Commission supports China membership in the world
trade organisation. They are of the view China has undergone dramatic
changes since it opened up to the outside world in 1978, evolving from
an inward-looking centrally planned economy to a market driven one
engaged in global commerce. During the past two decades, EU-China
trade increased more than 20 fold and was worth 70 billion euro in
1999. China is the Union's third largest non-European trading partner
after the United States and Japan and the EU is China's fourth largest
source of imports. In 1999, the Union became the largest foreign
direct investor in the country, excluding Hong Kong, with 4.5 billion
euro.

The union has been a strong supporter of Chinese
membership of the World Trade Organisation and has worked closely with
the United States to help bring this about. In summer 2000, the two
parties completed their lengthy bilateral negotiations on China's
accession to the WTO. The agreement will give a major boost to trade
between the two.

Under the terms of the EU-China WTO accession
agreement, China agreed to substantial reductions on import tariffs
for over 150 leading European exports, ranging from machinery to wines
and spirits. The accord will make it easier for European distributors
and companies to operate in China and restrictions which used to apply
to a number of service sectors and professions such as bankers and
lawyers will also be relaxed.

The European Union is the world's biggest trading
partner, accounting for over a fifth of all exports in 1999. Since its
earliest days, the EU has been committed to removing trade barriers
between its individual members on the grounds that this will stimulate
economic prosperity and national and individual well-being. It has
championed the same principles on the world stage.

The figures speak for themselves. The multilateral
trading system has been progressively liberalised through a series of
international negotiations over the past half-century. During that
time, world trade has grown seventeen-fold, world production has more
than quadrupled, world per capita income has doubled and average
tariffs applied by industrialised countries have dropped from 40% in
1940 to under 4%.

"The EU believes that multilateral trade
liberalisation can yield very substantial benefits for the global
economy and that much of this should go to developing regions. It
considers that economic growth through trade liberalisation is a major
factor in improving social conditions worldwide and contributing to
sustainable development."

The Union is one of the strongest advocates of
continuing this trend by pressing for as wide an agenda as possible in
the next round of World Trade Organisation (WTO) talks involving 137
countries. Despite the setback at the ministerial meeting held in
Seattle in December 1999, the EU is still committed to a broad agenda
and is convinced the benefits will be significant.

"As part of this wide ranging agenda, the EU
is in the vanguard of countries arguing that the next WTO negotiations
should not be limited to the narrow agenda of agriculture and services
left over from the last Uruguay round. It must be more comprehensive,
covering both traditional topics and new issues to allow all
participants to have an interest in the negotiations and meet the need
of the economy of the 21st century."

The Union has drawn two clear lessons from the
failure to open the liberalisation talks in Seattle. The first is that
the days when a handful of major trading nations negotiated deals
among themselves and imposed them on the rest of the world are over.
Others, particularly developing countries, now legitimately demand a
bigger say in the process."

"The second is that the WTO must be reformed
to make it more inclusive, transparent, efficient and accountable. Its
rule book needs to be rewritten and civil society more closely
involved so that environmental and social concerns can be considered
alongside trade and development."

When a new round of WTO negotiations is launched,
the Union believes it should cover at least four main areas if it is
to be comprehensive and successful. In the EU's view, the round should
improve market access across the board, including agriculture services
and non-agricultural products.

Set rules in a number of new areas such as
investment, competition and trade facilitation.

Focus more on development by providing better
market access and improvements to the special and differential
treatment accord to developing countries, as well as ensuring that new
agreements promote development.

Address a number of civil society concerns, by
clarifying WTO rules on trade and environmental agreements, labeling,
public health and the application of the precautionary principle. This
should be done with a view to ensuring that rules are mutually
supportive and the measurers taken do not constitute a means of 13
arbitrary or unjustifiable discrimination between countries.